Use Bid/Ask Spreads to Measure Liquidity, Not Open Interest
One question we’re often asked about our trades is why we would present ideas that have low volume and open interest. The answer might surprise you: It’s because open interest and volume are not reliable indicators of liquidity. Option liquidity is primarily a function of the underlying stock’s liquidity. Here’s why:...
Secret to Consistent Income with Options
The success to trading any strategy on stocks or options is consistency. This is true for both researching the underlying stock or ETF, and choosing the right trading strategy. Having a consistent approach such as technical or fundamental analysis leads to reliable research that doesn’t conflict. The same applies to...
Generating Consistent Income with Covered Calls
Generating consistent income with covered calls can be achieved when using a disciplined and methodical approach. It’s important to understand your personal preferences before searching for income opportunities on your portfolio. Choosing expirations that suits your trading frequency and strike prices that fit your risk...
Tony Zhang
Head of Product Strategy for OptionsPlay
OptionsPlay
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